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OMERS Updates

2020 Proposed Plan Changes – Executive Summary

** Note: OMERS Plan Changes were approved on June 24, 2020. Links previously provided on this page have been updated.

OMERS is proposing plan changes, including a change that will alter the way a future reduction to indexing could be spread across OMERS members.

The Police Association of Ontario supports the proposed changes as they are necessary to make the Plan more equitable between current and future members. Additionally, the proposed changes are supported by our employee colleagues at the Ontario Professional Fire Fighters Association (OPFFA – and the Ontario Secondary Schools Teachers Federation (OSSTF).

For current OMERS members, there will be no change to pension entitlements related to service time before 2023.

Entitlements related to service time after 2023 may receive a reduced level of indexing if the health of the plan is threatened by a significant negative economic event sometime in the future.

Additionally, in response to the COVID-19 pandemic, three additional Plan amendments have been proposed for consideration by the SC Board. These COVID-19 amendments can be reviewed at

Please click on the accordion sections below for a full update on OMERS’ proposed plan changes.

  • About the OMERS Pension Plan

    OMERS is a jointly-sponsored, defined benefit, pension plan. The Plan is governed by two Boards of Directors appointed by the “sponsors” of the Plan – the largest unions and employers with members in the Plan. The Police Association of Ontario is one of 14 “sponsors” of the OMERS pension plan.

    As a jointly-sponsored plan, employees and employers fund the plan together and govern it together. If you are a member of a police association that is a member of the PAO, your local executive can contact the PAO directly and share feedback about the Plan. That feedback helps the PAO work with its representatives on the OMERS Boards.

    The PAO’s representative on the OMERS Sponsor’s Corporation (SC) Board is Dan Axford. Dan is a retired police officer and former president and administrator of the London Police Association, as well as a past president of the PAO. The Sponsor’s Corporation is the governing body of OMERS that determines plan changes.

    The PAO Board of Directors is elected from among the over 18,000 individual members of Ontario’s municipal police associations. The PAO Board appointed Dan to the OMERS SC Board in 2015; his term was most recently renewed in 2020.

  • OMERS Plan Change Process

    On February 25, 2020, the OMERS SC Board met and decided to:

    • Hold a vote on two proposed plan changes in June 2020; and
    • Waive their process of plan change confidentiality in order to share the proposed plan changes with sponsors and members ahead of usual timelines


    The changes that have been proposed are not new. They have been discussed a number of times in the past and were considered in depth in 2018.

    Upon learning the details of the potential changes, the PAO convened its Pensions Committee in order to form a recommendation with regard to the changes.

    The PAO Pensions Committee, PAO Board of Directors, and PAO SC Board representative Dan Axford all support these changes.

    Based on our review of the evidence surrounding the needs of the Plan, our discussions with our representatives, our engagement with other sponsor unions and stakeholders, and our communications with OMERS staff and administration, we have concluded that these changes are not only beneficial to our members, but necessary.

  • OMERS Proposed Plan Changes

    There are two plan changes that OMERS is proposing:

    • Non-full-time enrollment: Employees of an OMERS employer will have the option to join OMERS regardless of hours worked or salary earned
    • Shared Risk Indexation: Changing the scope of a future decision to reduce indexation


    Currently, workers who are not members of OMERS due to mandatory enrollment have the option to join OMERS if they work for an OMERS employer and they meet a certain hours-worked and earnings threshold. The proposal would remove the hours threshold, giving more non-full-time workers the option to join OMERS.

    OMERS pensions increase every year in order to keep pace with inflation – this is called “indexing”. Under the current Plan, the SC Board may vote (2/3 majority) to reduce any pension benefit, including indexing, for service time after the date of the vote.

    Under the shared-risk model, the SC Board may, in the future, vote (2/3 majority) to reduce indexing for service accrued after January 1, 2023. Any pension accrued before 2023 will always be indexed at 100% of the Consumer Price Index.

  • Why Does OMERS Need Shared-Risk Indexing?

    When a pension plan experiences a significant shock, usually due to external economic factors, its administrators will consider the following options:

    • Make no changes to the Plan and rely on the current framework to return the Plan to health
    • Increase contribution rates for employers and employees in order to bring more money into the Plan
    • Reduce benefits such as early retirement, survivor benefits, or adjustments to indexing for members in order to diminish the Plan’s level of liability


    In 2009, OMERS was able to rely primarily on a long-term increase to contribution levels to recover from the 2008 financial crisis. This recovery is anticipated to be complete in 2025 and was possible because room existed to raise contribution levels to where they remain today and there were enough active members in the plan as compared to retirees to continue to bring money into the plan.

    As of 2019, the Plan operates in a contribution-benefit deficit: there is more money exiting the plan in the form of benefits than is coming in via contributions. Investment returns are making up the difference. By the year 2035, OMERS will pay out $4 billion more in pension benefits than it gathers in contributions.

    This means that the plan may not be able to rely on the same strategy in the face of a future economic crisis as it did in 2009. Therefore, OMERS must now confront how future Boards will alter the benefit promise if and when it is forced to do so.

    If a future OMERS Board, after assessing the Plan’s framework and raising contribution rates to a maximum, is forced to make changes to benefits, an adjustment to indexing under a shared risk model would potentially be preferable to other reductions. Why? The effect of a reduction in indexing would be spread over a larger number of members and retirees. This means that the impact on each individual member is smaller and would last for a shorter amount of time. If there is no option to reduce indexing, the decision to cut benefits will mean a significant reduction in the value of pensions for members who are working on the date a crisis hits.

  • How Shared Risk Indexing Could Work

    Note: Any reductions in indexing payments would only effect the part of your pension related to service from 2023 and beyond.

    If, in the future, the plan experiences a shock that could not be managed through investment returns and contribution increases, the OMERS SC Board at that time would have to consider benefit reductions in order to maintain the health of the plan. One of those benefit reductions could be a partial or full reduction in the indexing being paid out that year. In order to implement a benefit reduction of any kind, the OMERS SC Board would have to vote by a 2/3 majority to implement the reduction. This means at least some of the employee appointees would have to be in favour of the reduction.

    A pension that is in payment during a time where indexing has been reduced or eliminated would see its annual increase in pension reduced or eliminated entirely (again, only for the portion of the pension related to post-2023 service). This does not mean the pension would shrink; it would just not grow by as much, or at all, and it would continue to not grow until indexing is restored, again by a 2/3 vote of the OMERS SC Board. Once indexing is restored on a go-forward basis, the OMERS SC Board would be able to turn its attention to restoring members to where they would have been if indexing never been removed or reduced. Only once indexing is restored would they look to reduce contribution rates for employees and employers.

    While this means potential volatility for future retirees, this is part of spreading the risk of managing plan shock between plan members working now and plan members who have yet to join the workforce and who will likely spend their entire careers contributing to a “mature” plan where benefits being paid out far exceed contributions being collected.

    Further details, such as the amount of reduction and the exact point where plan health would require a reduction in benefits, will be up to the future OMERS SC Board to determine. The PAO is committed to ensuring that our representative on the SC Board is prepared and empowered to make the right decision for current and future plan members. The PAO will always favour an evidence-based approach to the pension promise.

  • PAO Position on OMERS Proposed Plan Changes & Next Steps

    The PAO Board of Directors endorses the two OMERS proposed plan changes. They have been determined to be fair for current and future members of the Plan. We have reviewed and analyzed the evidence and are confident that there is simply not enough money coming generated by contributions to allow the Plan to withstand a significant economic shock.

    Additionally, the proposed changes are supported by our employee colleagues at the Ontario Professional Fire Fighters Association (OPFFA – and the Ontario Secondary Schools Teachers Federation (OSSTF).

    Further, as a sponsor of OMERS, the individuals who have made these proposals and determinations are directly accountable to the OMERS SC Board, including to the PAO’s appointee. As the fine details of this proposal are developed, the PAO will have a voice at the table to ensure that the framework represents the best possible outcome for police members.

OMERS has published a full guide to the 2020 Plan Review for plan members and stakeholders. It can be found on their website at and

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